Final answer:
Merchandise inventory is not reported in the long-term assets section of the balance sheet, but rather it is reported as a current asset.
Step-by-step explanation:
The statement in the question is incorrect. Merchandise inventory is not reported in the long-term assets section of the balance sheet, but rather it is reported as a current asset.
Current assets are assets that are expected to be converted into cash or used up within one year or one operating cycle, whichever is longer. Examples of current assets include cash, accounts receivable, and inventory.
On the balance sheet, assets are typically presented in order of liquidity, from most liquid to least liquid, with current assets listed first.